Friday, February 24, 2006

I had planned to put something under the headline of "Any storm in a port," but I was beaten to the punch. Oh, well.

Dubai Ports World is set to acquire the Peninsular & Oriental (P&O) Steam Navigation Company's operations, including facilities in six U.S. ports (New York City, New Jersey, Philadelphia, Baltimore, Miami, and what's left of New Orleans), but the deal has run into strong resistance in the United States.

P&O is a British company, publicly traded on the London stock exchange. It is the fourth-largest operator of ports in the world, and it also operates ferry services in Europe.

Oddly enough, Dubai Ports World (DPW) is based in Dubai, which is in the United Arab Emirates (UAE), which is in the Middle East. It's a little corner of the Arabian Peninsula, right on the Persian Gulf. The Persian Gulf is also adjacent to Saudi Arabia, Qatar, Bahrain, Kuwait, Iraq, and Iran (formerly known as Persia). The UAE sits very close to the Straits of Hormuz, a strategic shipping bottleneck between Oman and Iran where it would be possible to stop all oil tankers from most of the Persian Gulf oil fields. Two of the 9/11 hijackers used the UAE as their home base, and there have been rumors that important UAE officials have connections to al Qaeda. Prior to 9/11, the UAE was one of only three nations on earth that gave formal diplomatic recognition to the Taliban government in Afghanistan. Michael Jackson now lives in the UAE, which only adds to its freaky charm. The Emirate of Dubai is one of the 7 states that comprise the UAE.

DPW operates port facilities in the Dominican Republic, Venezuela, Germany, Romania, Morocco, Saudi Arabia, Djibouti, India, China, Malaysia, South Korea, Australia, and the Emirate of al Fujairah (Al Fujairah is the only one of the 7 UAE states with ports on the Gulf of Oman rather than the Persian Gulf.), in addition to its facilities in Dubai.

There are a few separate issues involved in the resistance to the deal.

First, there is the "We don't want no Amerikun ports run by no ragheads!!" [رأس يغطّى مع خرق قديمة] issue. Undeniably, much of the resistance to the deal is rooted in a strong mistrust and antipathy towards Arabs, Muslims, and Arab Muslims. The extreme of that sentiment is the "Nuke 'em til they glow, then shoot 'em in the dark!" [قصفتهم مع سلاح نوويّ حتّى مضيئة ، بعد ذلك قتلتهم مع بندقيّة في الليل] faction. While it is true that the UAE has had some connection to al Qaeda, the UAE government has been vocally supportive of the US government's anti-terror efforts. It is also true that there has been "some connection" of al Qaeda to Saudi Arabia, Germany, the Philippines, and Florida, among many other places.

Second, there is the natural resistance to ownership of vital American infrastructure by any foreign entity. However, since P&O is a foreign entity, I would have to say that the ship has already sailed. Foreign ownership of American ports is a legitimate cause for concern regarding our own economic competitiveness, if the only thing we can do with cargo ships is pay (on credit) for all the pretty toys and trinkets they bring us. By the same token, foreign (even including British) ownership of factories, banks, and delivery companies is a long-term concern. What if DHL were owned by the German post office? Oh, wait — it already is! For the present, though, this general concern is not particularly relevant to the transfer of American ports from British to Arab hands.

Third, though, is a rather meatier issue: the resistance to ownership of vital American economic infrastructure by a foreign government entity. If this deal would permit any foreign government — including the British — to use its control of six very important port facilities as leverage to influence US policy, then clearly we would have to stop it. Given that DPW is owned by the Emirate of Dubai, what assurance do we have that the Dubai government or the UAE government will not politicize the operation of the ports? (That's Congress's job!) Will a DPW-run port explicitly or implicitly seek UAE governmental approval of any shipments in or out? Will a DPW-run port be willing to load or unload a shipment of pork, lobsters, or frog legs (all items which may be viewed as intrinsically not Halaal [حلا], the Islamic counterpart to Kosher [כַּשְׁרוּת])? Will a DPW-run port treat a ship to or from Israel equitably? Will a DPW-run port halt or impede the shipment of weapons to Israel? If the deal is approved, it must be with the clear understanding that all shipping in and out of US ports will be handled in accordance with US law only, not by any other standard.

Lastly, the manner in which the deal was approved by the Bush Administration showed the same bumbling incompetence that characterized the management of the Katrina crisis. First of all, it should have been immediately obvious that a change of ownership of six major US port facilities should not have tried to slip by "under the radar." Yes, news of the proposed merger has been in the business pages of the newspapers since October, but this was the sort of deal that should have gone to the Oval Office and from there to Congressional leaders before getting approval. George W. Bush didn't even know about the deal (or so we're told) until he heard about it on the news. (I guess there weren't any Mighty Morphine Powder Rangers re-runs on the tv.) Given the enormous political gaffes the administration has blundered into in recent months, not least the furor over the Vice President's cover-up of the circumstances of his hunting accident, someone in the executive branch should have recognized that the sale of major ports to a foreign government should be handled with a little bit more finesse than issuing a retroactive upland game bird hunting permit.

Once the deal did make the news, though, the Bush administration followed blunder with self-immolation by trying to force the deal through on the strength of Dubya's "Don't make me get my veto pen!" mantra. When the Congress raises serious concerns that resonate with the American public, quashing all dissent isn't even on the same planet with the right response. Bush just snapped into his reflexive "questioning my administration is unpatriotic" posture. In view of the rising concerns about Bush's plans to eclipse Nixon's vision of the Imperial Presidency, it was clearly the wrong time to say, "Because I said so, that's why!" Fortunately for Bush, he has retreated from his rash, incendiary rhetoric, thanks in part to DPW's willingness to accept a brief delay in consummation of the deal.

Personally, I think the deal probably should be and probably will be approved. The pathetically inadequate security at US port facilities will not be improved one ιοτα by rejecting the purchase of P&O by DPW. Of course, DPW and the Dubai government and the UAE government should all publicly commit to keeping the US operations of DPW entirely separate from any political shenanigans. I also believe that the Congress is absolutely right to call hearings to allay the legitimate concerns regarding this deal. Needless to say, Michael "Call Me Katrina" Chertoff also must get off his lazy, incompetent ass and do something that will actually improve security in our ports.